The Inquiry by Lord Justice Bingham (the Bingham Report) identified important errors of judgment and shortcomings in the Bank of England’s supervision of BCCI. This led to a further question: should those who suffered loss or hardship as a result of BCCI’s closure have received compensation from the UK Government?
The UK Government did not establish a separate compensation scheme for BCCI victims, although compensation had been provided in other financial cases where serious regulatory or supervisory failings had been identified.
This position was maintained despite the findings of the Bingham Inquiry and the subsequent UK parliamentary examination of BCCI, which identified significant shortcomings in the Bank of England’s supervision and raised further concerns about how those responsibilities had been carried out.
The result was that BCCI depositors, creditors, employees and others affected by the abrupt closure received no separate UK Government compensation for supervisory failures, even though comparable compensation had been provided in other cases involving failures by public authorities.
The wider comparison with Barlow Clowes, Equitable Life and other cases, together with the parliamentary debate over equal treatment, is examined separately under Double Standards - Compensation.
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